About GST errors
A GST error is a mistake you made in working out your GST net amount on your BAS that would if it was the only mistake that you made, result in you reporting or paying:
- too much GST (credit error)
- too little GST (debit error).
A GST error doesn't include an error relating to fuel tax credits, wine equalisation tax (WET) or luxury car tax (LCT).
Example: GST error
While working out the GST net amount for the monthly reporting period ending 30 June, Bronlynn incorrectly reported the GST payable on a GST-inclusive taxable sale of $1,100.
Bronlynn reported and paid the GST as $1,000 when the correct value should have been $100. The GST error is the overpaid GST ($900).
End of exampleWhat is not a GST error
The following are not included in the definition of a GST error:
Claiming a GST credit on a later BAS
Claiming a GST credit on a later BAS because you failed to claim it in an earlier BAS is not a GST error. If you did not claim a GST credit for a purchase at the time when you were entitled to claim it (for example, you were not aware that you had a tax invoice) you are entitled to claim it on a later BAS.
A 4 year time limit generally applies to GST credit claims.
GST adjustments
You make a GST adjustment if a change occurs that affects the:
- amount of GST payable for a sale
- GST credit you are entitled to for a purchase.
A GST adjustment relates to a reported sale or purchase that was correct at the time of lodgment.
However, it would be a GST error if you:
- overlooked an adjustment
- incorrectly worked out the amount of the adjustment in an earlier tax period.
This type of error could be corrected in a later BAS, subject to the applicable time and value limits.
Incorrectly charged GST
Excess GST is when you incorrectly treat something as taxable and include GST for it in your BAS. However, the excess GST is treated as correctly payable on a taxable sale where you:
- have passed on the excess GST to your customer in the price they paid for the sale
- have not reimbursed the customer.
The passed on excess GST is not an error. It can, however, be recovered through a decreasing adjustment if you have first reimbursed your customer for the passed on excess GST. For more information see Incorrectly charged GST.